Marketing expert Sascha Moore explains how brokers can get a competitive edge by defining their point of difference
In a time of ever-increasing competition and a marketplace where being exceptional is becoming the norm, it’s never been more critical to determine a point of difference (ie what you do specifically that differentiates you from your competitors). And it’s a musthave for optimising your business.
However, prioritising your point of difference is typically trumped by doing business, particularly in the SME space. What’s possibly not understood well enough is why defining a point of difference is so powerful, and how it can directly correlate with generating more sales. The reason for this is simple: if people understand what you do, why it’s different and how it can benefit them, they’re more likely to do business with you.
The good news is that you don’t need to invest any money in this process, just a bit of time. Similarly, determining your point of difference shouldn’t take countless hours, but you will need to be committed to thinking it through. On the upside, this can be done at any time of the day – for example when you’re commuting or in transit to/from meetings. And the post-Christmas hiatus is the perfect time of year to take time to think about it.
So that’s all well and good, but how do you work it out?
A point of difference can be determined by many variables, but before we get intom semantics, it would be timely to address some common myths.
If people understand what you do, why it’s different and how it can benefit them, they’re more likely to do business with you
Service is not a point of difference. Being trustworthy, personable and easily contactable is not a point of difference. Being faster, having access to multiple lenders, making the process easier, and having appropriate technology are not points of difference. These are all expectations, which can make life rather difficult when you’re trying to stand out from the crowd. Another challenge for brokers is that price isn’t a common point of difference due to access to common lenders and, typically, preset rates.
As a place to start, ask yourself:
- What do you do?
- What demand does it fulfil?
- Why is it different?
As part of this process, it’s worth fleshing out your response to the ‘What do you do?’ question, as it seems simple but the answer is critical. The linear response to this question would typically be: “I’m a mortgage broker”. While this is most likely correct, you might be selling yourself short if you don’t answer the question in context. “I’m a mortgage broker” is fine if a client needs a straightforward mortgage, but this answer might limit your potential to provide a financial solution that reflects their circumstances (such as if they’ve found themselves in a place of bad credit, are an SME, could benefit from asset finance, require a bridging loan, etc).
To take this further, consider:
- Are you a pure-play residential mortgage provider?
- What are your areas of diversification?
- Is your diversification concentrated on a specific area (ie asset finance), or are you across multiple lending solutions?
- Which geographical area is your target market? (Don’t say ‘national’…)
The next step is to match your product/service features and benefits with the demand they fulfil for your end user. Without this, your point of difference is only halfbaked. Rather than saying “I’m a mortgage broker”, consider quantifying the statement and adding in an end-user benefit, such as:
- “I’m a specialist residential mortgage provider in the Northern Beaches”, whichm means “I understand where you’re coming from and what type of loan would best suit your requirements”.
- “I’m a mortgage broker who also specialises in asset finance”, which means “I can help you with your home loan as well as sorting out the financing of your personal and commercial assets”.
- “I provide financial solutions”, which means “I can help you get a mortgage, and help you sort out finance for any challenges or opportunities, whether that’s business or personal”.
These examples are by no means exhaustive but hopefully illustrate the point.
You should also take into account that your ‘pitch’ needs to be delivered in a sentence, not a soliloquy. The reason it’s so important to be succinct in your offering is that we’re bombarded with information 24/7, and as humans we naturally want to quickly categorise a product or service. This is coupled with an increasing addiction to information (which conversely can have the polar effect on absorption), meaning very, very short attention spans. The upshot: you don’t have long to get your market on board. To increase traction, make every word count, and deliver it from their perspective.
The proof is in the pudding. Put into place measures to determine the success of your point of difference to make sure it’s on point. These should include both soft and hard KPIs. Examples of soft KPIs are increased customer loyalty (demonstrated by retention) and increased referrals. Hard KPIs should relate to an increase in business (ie sales/turnover). It’s recommended to assess these quarterly.
Lastly, identifying your ideal client as part of the point-of-difference process would be really worthwhile. You will probably know most of this already, but it’s a valuable exercise to take a really good look at your transactions and work out the common patterns in your book. It’s worth assessing this based on year-on-year sales, to include the types of loans, postcodes, circumstances (ie self-employed, first home buyers, bad credit, etc), as well as age, gender and income. This will clarify who your market actually is, what they’re interested in, and where there’s scope to grow. Keep in mind that the more targeted you can be, the more traction you’ll get (read ‘sales’).
And therein lies the opportunity: your audience is more likely to engage with you instead of your competitors if your offering is easy to comprehend and, most importantly, aligned with their circumstances and requirements from the outset.
Sascha Moore is the director of Create Design & Marketing and specialises in providing communications solutions to the financial services and legal industries. Learn more at createdesign.com.au.